In the absence of tangible quality cues, consumers often use reference prices as an indicator of product quality.

Question

Quizplus · Accepted Answer

When consumers lack tangible quality cues, they often rely on reference prices (i.e. the price range they believe the product should be) as a proxy for product quality. This is because people often associate higher prices with higher quality, so if a product is priced above its reference price, consumers may assume it is of higher quality. However, this is not always an accurate indicator and can lead to consumer bias and false perceptions of quality.

In the Absence of Tangible Quality Cues, Consumers Often Use